A business system should be what connects all the parts of a company or organisation, ensuring they are working together to meet the business’s objectives.
While many SMEs and startups may at first evolve almost organically, without establishing business systems, they risk their growth stalling and, ultimately, their business failing.
Making Sense of Your Business
“Many businesses operate in a state of near-permanent chaos. For them, it might not feel especially unusual, because it’s what they’re used to, but they are taking a big risk in the long term.”
People who start businesses may begin from a position of opportunity, seizing their moment, or pressing on regardless of obstacles, but this kind of energy is unlikely to keep serving them well if they want to create something that will endure.
“Without the right business system in place, it’s like building a structure on shaky foundations where there’s every chance that growth will be piecemeal, and wildly uneven, and that consolidation will prove difficult”
Essentially, the critical thing is for business owners to take a step back and gain a fresh perspective on what it is they have created.
“Close up, you can be sucked into the machinery of what it is you do without gaining the necessary broader vision that will help you impose a sense of order on it. And this sense of order comes with developing a business system.”
What Does Having a Business System Mean?
“It means you have something in place, formally, that ensures one aspect of your business is talking to another, and that all the aspects of what you do are properly interconnected.”
For example, problem-solving tasks need to relate to decision-making ones; and management structures must work closely with people on the ground, so that there is a clear understanding of what goals are realistically achievable, and what performance levels can be reached.
“Business systems are also about processes, so everyone working in a business understands their role, and what they should be doing in relation to others.”
For the business owner, this can mean taking their personality out of the nuts and bolts, so that the business can run independently of their input on a day to day basis.
“The value of your business is not determined by your presence or even your vision of what it’s about. It comes from how well-structured the business is to perform, to be profitable and, hopefully, to grow”
Businesses evolve effectively when they take on a life of their own, but this has to be in a systematic, ordered fashion.
“Regardless of the projects you have planned, or the clients in the pipeline, without a system you are missing the essential building blocks of business growth.”
According to Bloomberg, eight out of ten businesses fail within the first 18 months, and 80% will fail in less than two years.
“Business is tough, but without a system, it’s that much tougher.”
For an accompanying read, please visit Does Your Operations Manual Enable You to Go Automatic?